Navigating employment termination in Armenia requires a thorough understanding of the local labor code to ensure compliance and avoid potential legal challenges. Both employers and employees have specific rights and obligations that must be respected throughout the termination process. Adhering to the established procedures for notice periods, severance pay, and documentation is crucial for a lawful and smooth separation.
Understanding the legal framework surrounding termination is essential for businesses operating in Armenia, whether they are winding down operations, restructuring, or addressing individual performance issues. Proper execution of the termination process protects the employer from claims of wrongful dismissal and ensures fair treatment of the employee according to Armenian law.
Notice Period Requirements
The required notice period for terminating an employment contract in Armenia depends primarily on the reason for termination and the type of contract. Providing the correct notice is a fundamental step in the termination process.
- Termination initiated by the employer (without employee fault): Generally requires a minimum notice period.
- Termination initiated by the employee: Also requires a specific notice period.
- Termination for employee fault: May allow for immediate termination without a notice period, but specific grounds must be met.
Here is a general overview of minimum notice periods:
| Reason for Termination | Minimum Notice Period |
|---|---|
| Termination by employer (e.g., redundancy, restructuring) | 14 calendar days |
| Termination by employee (resignation) | 14 calendar days |
| Termination during probationary period | 3 calendar days |
| Termination for gross misconduct or specific fault | No notice required |
It is important to note that the employment contract or collective bargaining agreement may stipulate longer notice periods than the statutory minimums.
Severance Pay
Severance pay in Armenia is typically required when an employment contract is terminated by the employer for reasons not related to the employee's fault, such as redundancy, liquidation of the company, or reduction in staff numbers. Severance is calculated based on the employee's average monthly salary and their length of service.
The standard severance entitlement is:
- For employees with less than one year of service: Severance equivalent to their average weekly salary.
- For employees with one to ten years of service: Severance equivalent to their average monthly salary.
- For employees with more than ten years of service: Severance equivalent to their average monthly salary multiplied by the number of years of service exceeding ten, plus one average monthly salary.
Severance pay is generally not required when the termination is due to the employee's fault or initiated by the employee (resignation), or upon the expiry of a fixed-term contract.
Grounds for Termination
Armenian labor law specifies various grounds upon which an employment contract can be terminated. These grounds are broadly categorized as termination with cause (due to employee fault) and termination without cause (due to employer circumstances or other reasons).
Termination with Cause (Employee Fault)
An employer may terminate an employment contract due to the employee's actions or inactions, including:
- Failure to perform job duties without valid reason.
- Gross violation of labor discipline or internal regulations.
- Absence from work without valid reason for a specified period.
- Disclosure of state, official, or commercial secrets.
- Committing theft or other intentional damage to employer property.
- Appearing at work under the influence of alcohol, narcotics, or toxic substances.
- Violation of labor protection rules resulting in serious consequences.
Termination Without Cause (Employer Circumstances)
Termination can also occur due to reasons not related to the employee's performance or conduct, such as:
- Liquidation of the employer entity.
- Reduction in staff numbers or positions.
- Inability of the employee to perform their job due to health reasons (confirmed by medical certificate).
- Reinstatement of an employee who previously held the position.
- Expiry of a fixed-term employment contract.
Procedural Requirements for Lawful Termination
To ensure a termination is lawful, employers must follow specific procedural steps. Failure to adhere to these requirements can lead to the termination being deemed wrongful.
Key procedural steps often include:
- Issuing a written notice: Providing the employee with a formal written notice of termination, specifying the grounds and the effective date, adhering to the required notice period.
- Documenting the grounds: For termination with cause, the employer must have documented evidence supporting the reason for dismissal (e.g., warnings, investigation reports). For termination without cause (like redundancy), documentation related to the decision-making process (e.g., minutes of meetings, revised organizational structure) is necessary.
- Calculating and paying final dues: Ensuring all outstanding salary, accrued but unused vacation pay, and applicable severance pay are calculated correctly and paid to the employee on their last day of employment.
- Issuing employment records: Providing the employee with necessary documents, such as a copy of the termination order and a certificate of employment, upon termination.
- Consultation (in some cases): Depending on the grounds for termination and the number of employees affected (e.g., mass redundancies), consultation with employee representatives or trade unions may be required.
Common pitfalls include insufficient documentation, failing to provide the correct notice period, incorrect calculation of final payments, and not following internal disciplinary procedures before terminating for cause.
Employee Protections Against Wrongful Dismissal
Armenian labor law provides employees with protections against unfair or unlawful termination. Employees who believe they have been wrongfully dismissed can challenge the termination in court.
Grounds for challenging a termination may include:
- Termination without valid legal grounds.
- Failure to follow the correct procedural requirements.
- Termination based on discrimination (e.g., due to gender, age, religion, disability).
- Termination during periods of protected leave (e.g., maternity leave, temporary incapacity).
If a court finds a termination to be wrongful, it may order the employer to reinstate the employee to their previous position and compensate them for lost wages during the period of unlawful dismissal. Employers must therefore ensure strict compliance with the labor code to mitigate the risk of such claims.
